Highlights of Annual Results for the Year Ended December 31, 2024 Revenue reached RMB1,986.7 million Gross profit amounted to RMB687.4 million Net profit recorded RMB222.0 million, a significant turnaround from a year ago Adjusted Non-IFRS net profit recorded RMB314.6 million, a YOY increase of nearly 50.6%.
SHANGHAI, March 27, 2025 /PRNewswire/ -- On March 27, 2025, Viva Biotech Holdings ("Viva Biotech", "the Group" or "the Company", stock code: 1873.HK) announced that for the Group's revenue during the Reporting Period achieved RMB1,986.7 million, gross profit amounted to RMB687.4 million and net profit recorded RMB222.0 million, a significant turnaround from a net loss of RMB99.8 million in the corresponding period of last year, mainly benefiting from the elimination of relevant financial adjustments due to the full repayment of convertible bonds, and an increase in adjusted non-IFRS net profit to RMB314.6 million from RMB208.8 million in the corresponding period of last year, representing an increase of nearly 50.6% as compared to last year, which was mainly attributable to an increase in operating profit margin driven by the recovery of CRO business growth and the improving operational efficiency in 2H2024, as well as the recognition of investment income from milestone payments received by the Group during the year.
In addition, the Group's subsidiary Viva Biotech Shanghai was successfully restructured into a joint stock limited company on September 27, 2024, as the Group currently holds approximately 72.9% of its total issued share capital. During the Reporting Period, the Group's management and its strategic investors commenced a number of collaborations with full mutual trust, fully utilizing the strategic investors' strengths in global vision, capital markets and strategic resources to empower the Group's continuous enhancement in corporate governance, business operations, investment and financing as well as strategic planning.
CRO Revenue Growth Improved Significantly Improving in the Second Half of the Year to Sustain a Recovery Momentum Ahead
In 2024, the revenue of the Company's CRO business decreased by approximately 4.0% to RMB810.9 million from RMB844.9 million in the same period of last year, while the corresponding adjusted gross profit decreased by approximately 1.9% to RMB357.1 million from RMB363.8 million in the same period of last year. The decrease in CRO revenue in 2024 as compared to previous years was mainly attributable to the short-term impact of the global biopharmaceutical investment and financing pressure in 2023 on the R&D investment in innovative drugs in 1H2024. However, with the gradual recovery of global biopharmaceutical investment and financing since 2024, the Company's CRO revenue in 2H2024 has realized positive year-on-year and quarter-on-quarter growth compared with the same period last year and the first half of 2024. In addition, the CRO order value has realized positive growth year-on-year, and the monthly new order value is still maintained at a high level, which will drive the Company's CRO revenue to further maintain the rebound trend in 2025. Meanwhile, the Company has also taken a series of effective measures to enhance operational efficiency to maintain the profitability of CRO at a higher level.
As of December 31, 2024, the Company's cumulative number of CRO customers increased to 1,568, including the world's top 10 pharmaceutical companies (based on the total revenue of the 2024 annual report), with the revenue share of the top 10 customers accounting for 24.4%. The CRO business has a diversified geographical distribution of customers, with the revenue share from overseas regions accounting for approximately 87.3%. Revenue from customers in Mainland China accounted for approximately 12.7%.
As of the end of 2024, the Company has cumulatively delivered more than 82,716 protein structures to the clients, approximately 17,681 of which were newly delivered in 2024. The R&D of the Company has accumulated over 2,098 independent drug targets, 112 of which were newly delivered in 2024. Currently, the Company maintains a leading global position in the industry in the field of protein structure analysis. During the Reporting Period, the utilization of synchrotron radiation source reached 1,867 hours. The Company established long-term cooperation with 13 synchrotron radiation source centers around the world, the Company will ensure uninterrupted data collection throughout the year.
In terms of marketing and business development, on one hand, the Company will obtain integrated service orders by fostering synergistic development of biological and chemical segments, on the other hand, the Company will actively continue to enhance the integration of digital marketing and offline business development (BD), while expanding its global BD team. During the Reporting Period, the Group not only strengthened its presence in the European market, but also established a branch in Boston, the United States. This marked a new milestone in the Company's global footprints, allowing us to further expand and deepen the international cooperation network. Moreover, the Company attaches great importance to the important role of artificial intelligence (AI) in drug R&D. Based on the efforts in improving efficiency and success rate, the Company combines dry and wet experiments to expand quantity and scale of new projects continuously. It is worth mentioning that by the end of 2024, the Company had participated in 157 AIDD projects, and the cumulative number of customers purchasing CADD/AIDD reached 51. Revenue from AI-enabled projects exceeded US$10 million, and cooperation with renowned institutions regarding a complete set of AI discovery solutions has been reached in some niche fields.
New Commercial CDMO Projects to be Launched Soon and the CMC Business Optimization and Adjustment Largely Completed
The Group is committed to building a one-stop service platform from R&D to production of global innovative drugs. Through the 100% equity interests acquisition of Zhejiang Langhua Pharmaceutical Co., Ltd (Langhua Pharmaceutical), the Group has been able to complete the deployment of the production side of the business. During the Reporting Period, the Group continued to expand CDMO capacity to prepare for commercial production of new molecules in the future. In addition, the Company completed optimization and adjustment of the CMC business.
In 2024, Langhua Pharmaceutical recorded revenue of RMB1,175.7 million and the adjusted gross profit of RMB344.5 million. As of December 31, 2024, Langhua Pharmaceutical had served 897 clients, with 66.8% of revenue accounted for by the top ten customers and 100% retention rate of the top ten customers. Currently, Langhua Pharmaceutical's CDMO business, in addition to the existing commercialized projects that can maintain natural growth, has two important new commercialized projects that are at the process performance qualification (PPQ) stage and are expected to be commercially launched in 2025 and 2026, respectively, which will serve as a new growth driver for the CDMO business in the future. With respect to production capacity, the current total available total capacity has reached 860 cubic meters. In addition, Langhua Pharmaceutical plans to establish a new production capacity of 400 cubic meters between 2024 and 2025 to cater the commercial production of new molecules, and the civil construction work has already been completed. This endeavor will provide sufficient assurance for the Company's revenue growth with the launch of new products and release of reserved capacity in the future. Langhua Pharmaceutical will continue to adhere to the principles of customer first and regulatory compliance in quality management, strengthen cooperation with quality customers, and continuously improve and enhance the guidance and operability of the quality system. During the Reporting Period, Langham Pharmaceutical passed the on-site inspections of WHO and FDA again, which fully demonstrates that the quality system of Langham Pharmaceutical is further well aligned with the international system standards, and can guarantee the provision of quality, safe and reliable CDMO services to the world's leading pharmaceutical enterprises.
In 2024, the Group adjusted its CMC business structure by focusing more on synthesis and analytics operations, strengthened BD efforts to overseas customers, and promoted continuous improvement in profitability through cost reduction, efficiency enhancement and customer mix optimization. Since its establishment, CMC has completed and is currently progressing with a total of 255 new drug projects, driven by a CMC R&D team of 105 members, and generated revenue of nearly RMB43.0 million. In addition, the projects channeled by the Group progressed smoothly, and one pipeline has rapidly advanced to Phase III clinical trials, showcasing the success of the Group's integrated strategy. In the future, the Group will further strengthen the BD and channeling efforts for acquiring high-quality CMC projects with a view to promoting revenue growth and profitability improvement of the CMC business on the basis of fully utilizing internal project resources, reducing costs and increasing efficiency.
Partial Exits of Incubation Portfolio Companies Continued to Realize Investment Returns, Accretive to the Group's Profits
During the Reporting Period, the Company achieved partial investment exits from a number of portfolio companies (Focus-X, Saverna, Dogma, Riparian, DTX and Nerio), realizing corresponding investment returns and generating total proceeds of nearly RMB162.5 million. As of December 31, 2024, the Group had invested in a total of 93 portfolio companies. The portfolio companies are mainly from the United States, Canada, Europe and China. 67.7% of the portfolio companies are from North America and 25.8% are from China.
In 2024, 11 of the Company's portfolio companies completed or were close to completing a new round of financing, raising approximately US$292.7 million. The R&D efforts of the portfolio companies were advancing smoothly, with the total number of pipeline projects reaching close to 227, of which 186 pipelines are in the preclinical stage and 41 pipelines in the clinical stage. So far, the Group has successfully realized 15 investment exits or partial exits. Furthermore, the Group may have several potential exits of our portfolio companies, and it also can be foreseen that a peak season of investment exits will arrive in the next three years.
As of December 31, 2024, the Company has strategically invested in a series of high-quality assets, including portfolio companies such as Haya, Mediar, Nerio, Full-Life, Absci, Dogma, Arthrosi, Basking, Cybrexa and FuseBio. In the future, as these portfolio companies to develop successfully, secure ongoing financing, and realize exits, the initial investments will gradually enter the harvesting phase, providing sustained cash returns and investment income for the Group.
Technology Highlights and R&D Breakthroughs
Viva Biotech's artificial intelligence technology, accumulated and developed over many years, is empowering its entire drug discovery platform. The current AI capabilities cover the full workflow of FIC drug discovery and are gradually transforming the logical paradigm of drug discovery through end-to-end integration. By focusing on new targets, novel MOA and new modalities, Viva Biotech has developed distinctive AI capabilities, driving its one-stop innovative drug R&D service platform from "AI-assisted" to "AI-driven".
New Target
A series of target protein structures not reported in the PDB protein structure database have been delivered to customers.
Novel MOA
Including allosteric mechanisms, target selectivity and conformational selectivity. Comprehensive drug discovery technologies such as DEL, ASMS, Intact-MS, SPR, NMR, crystal soaking, virtual screening, membrane protein technology, phage display and HTS; as well as various experimental validation techniques including protein crystal structures, Cryo-EM structures, HDX-MS and Bioassay. Additionally, the Company provides medicinal chemistry, computational chemistry, Pharmacology and DMPK services.
New Modality
Established platforms such as the XDC platform, peptide technology platform, PROTAC/molecular glue platform, and antibody/large molecule R&D technology platform.
XDC Platform:
Successfully integrated biologics/antibody platforms, peptide platforms, and small molecule drug platforms into the XDC large platform, covering multiple fields and capable of supporting various conjugated molecular models such as ADC, RDC, AOC, APC, DAC, etc. Additionally, the XDC platform has been deeply integrated with AIDD/CADD technologies and DEL technologies.
Peptide Technology Platform:
At the peptide discovery journey, a new AI-based peptide generation method has been developed, as well as a peptide screening strategy combining DEL/phage display screening data with AI analysis capabilities. Through a multi-dimension peptide research and development approach, the success rate of customer peptide R&D has been comprehensively improved. The company also provides one-stop peptide R&D and partial production services, including synthesis, biological testing, and PK research.
PROTAC/ Molecular Glue Platform:
PROTAC/molecular glue-related services account for approximately 10.75% of the CRO's total revenue. Over 50 E3 ligases have been researched, and more than 150 PROTAC ternary complexes have been delivered.
Macromolecular Drug/Antibody Platform:
By combining AIDD/CADD technologies, multiple high-difficulty antibody affinity modification projects and patent breakthroughs have been successfully completed. Furthermore, the antibody R&D platform has been enhanced through the expansion and improvement of bispecific antibody design platforms, high-throughput antibody rapid expression platforms, mRNA immunization, gene gun immunization, and other technologies.
AI-enabled SBDD One-Stop Novel Drug R&D Service Platform
The Company's AIDD and CADD platforms possess proprietary algorithms and platform-building capabilities, along with experience in developing various drug modalities. Leveraging Viva Biotech's strengths in structure-based drug R&D and supported by the computational power of the Shanghai supercomputing cluster, these platforms comprehensively empower all stages of early drug development. Building on this foundation, Viva Biotech is transitioning from a phase where computational methods primarily supported various drug development stages to a new phase where AI drives drug design, integrates with experimentation, and transforms the drug design paradigm.
Staff and Facilities
As at December 31, 2024, the Group had a total of 2,063 employees, of whom the number of CRO R&D personnel reached 1,121, and the headcount of Langhua Pharmaceutical was 711. The Company has well-established office and laboratory facilities in line, and is expanding production capacity to meet the fast-growing business needs, including:
The Group's headquarters in Zhoupu, Shanghai, with a total area of approximately 40,000 square meters.
The incubation center located in Faladi Road, Shanghai has an actual usable area of approximately 7,576 square meters, including 5,552 square meters of laboratory area.
The park in Chengdu is approximately 64,564 square meters, of which 12,210 square meters of properties had been put into use as at December 31, 2024, including 10,800 square meters of laboratory area.
A park in Suzhou is approximately 7,545 square meters, including nearly 5,305 square meters of laboratory area.
A park in Jiaxing is approximately 6,362 square meters, including nearly 5,335 square meters of laboratory area.
Shanghai Supercomputing Center has been officially put into operation in 2021. At present, it can support computer-aided drug discovery (CADD) computation, artificial intelligence in drug discovery (AIDD) related computation, and crystal structure and Cryo-EM (Micro-ED) computation.
The factory of Langhua Pharmaceutical in Taizhou, Zhejiang is approximately 35,168 square meters, including the Taizhou R&D center with an area of approximately 2,500 square meters. The R&D center of Ningbo Nuobai has an area of approximately 1,300 square meters and the office building of Ningbo Nuobai has an area of approximately 1,500 square meters.
Dr. Mao Chen Cheney, Chairman and Chief Executive Officer of Viva Biotech, said, "With unique advantages in structure-based drug R&D (SBDD), the Company will increase the cross-sell between biological and chemical businesses, continue to strengthen the construction of a one-stop drug R&D and manufacturing service platform, deepen the synergy between CRO and CDMO business, improve the capacity building for front-end services and drive business to back-end services to further enhance the business funnel effect. The Company is in an effort to establish an open eco-system for global biopharma innovators. "
About Viva Biotech
Established in 2008, Viva Biotech (01873.HK) provides one-stop services ranging from early-stage Structure-Based Drug R&D to commercial drug delivery to global biopharmaceutical innovators. We offer leading early-stage to late-phase drug discovery expertise by integrating our dedicated team of experts, cutting-edge technology platforms, and state-of-the-art equipment in X-ray crystallization, Cryo-EM, DEL, ASMS, SPR, HDX, AIDD/CADD, and much more. Our business covers all aspects of therapeutic strategies and drug modalities, including small molecules and biologics across the pharma and biotech spectrum. The experienced chemistry team, led by senior medicinal chemists and drug discovery biologists, provides services for drug design, medicinal chemistry (hit to lead and lead optimization), custom synthesis, chemical analysis and purification, kilogram scale-up, peptide synthesis and corresponding bioassays. With our subsidiary, Langhua Pharma, we offer our worldwide pharmaceutical and biotech partners a one-stop integrated CMC (Chemical, Manufacturing, and Control) service from preclinical to commercial manufacturing. Additionally, Viva embedded an equity for service (EFS) model to high potential startups to address unmet medical needs.
As of December 31, 2024, Viva Biotech had cumulatively provided drug R&D and manufacturing services to 2,465 biotech and pharmaceutical clients around the world. We have invested and incubated 93 biotech start-ups in total. In the future, the company will continue to strengthen its technological barriers and improve R&D, production levels, and our service capacity to provide high-quality and diversified services for more drug discovery start-ups, as well as medium and large pharmaceutical enterprises around the world.
